Supporting Particulars in Claims

Claim is not defined in the FIDIC and any other major form of the Contract except American Institute of Architect (AIA) Contract Section 15.1.1 which defines a Claim as “a demand or assertion by one of the parties seeking, as a matter of right, payment of money, a change in the Contract Time, or other relief with respect to the terms of the Contract.” Additionally, Claims also include “other disputes and matters in question between the Owner and Contractor arising out of or relating to the Contract.”

However, as per the Contract experts, the fundamental prerequisite is for the claim to be particularized. The Contractor is required to set out the details of the Employer’s risk events relied on and the compensation claimed with sufficient particularity so that the Employer knows the case that’s being made against it. Gabriel Mulero Clas states, “the particulars should be detailed enough to allow the Employer and the Engineer to understand the basic elements of the problem and address it or prepare for any time and/or financial repercussions.”

?The difficulty is that there is no absolute clarity in FIDIC and other form of contract how particular looks like which warrant difference in the opinion of the parties involved in the contract. However, there some sort of piecemeal definition can be found in clause by clause of FIDIC Contract Books and FIDIC Contract Guide.

Sub-Clause 2.5 [Employer’s Claims]

Sub-Clause 2.5 states that If the Employer considers himself to be entitled to any payment under any Clause of these Conditions or otherwise in connection with the Contract, and/or to any extension of the Defects Notification Period, the Employer or the Engineer shall give notice and particulars to the Contractor. Here it is clarified that the particulars shall specify the Clause or other basis of the claim, and shall include substantiation of the amount and/or extension to which the Employer considers himself to be entitled in connection with the Contract.

Sub-Clause 3.4 [Replacement of the Engineer]

Sub-Clause 3.4 states that If the Contractor considers the intended replacement Engineer to be unsuitable, he has the right to raise objection against him by notice to the Employer, with supporting particulars. The supporting particulars in this clause could be evidence that the proposed replacement is potentially not impartial or independent due, for example, to existing relationships or interests; inadequate qualifications and/or experience; or specific requirements set out in the contract documents. In the case of Scheldebouw BV v St James Homes (Grosvenor Dock) Ltd, where the Contractor made objection to the Employer’s sought to replace an independent construction manager with his own employee and the objection was endorsed by the court. It was upheld “The construction manager is under a legal duty to perform his decision-making function in a manner which is independent, impartial, fair and honest.”

Sub-Clause 3.5[Determinations]

Sub-Clause 3.5 states that the Engineer shall give notice to both Parties of each agreement or determination, with supporting particulars, within 28 days from the receipt of the corresponding claim or request except when otherwise specified. But, supporting particulars are not defined and therefore their form and extent are open to dispute. Although it is not expressly stated that the Engineer must give reasons in his determination. However, as per commentary of Victoria Tyson of Corbett & Co, it is open to question that reasons for the determination would fall within “supporting particulars”. It is indeed good practice to contribute reasons.

Sub-Clause 20.1[Contractor’s Claims]

Sub-Clause 20.1 states that the Contractor shall also submit any other notices which are required by the Contract, and supporting particulars for the claim, all as relevant to such event or circumstance. It also states that the Contractor shall keep such contemporary records as may be necessary to substantiate any claim, either on the Site or at another location acceptable to the Engineer.

Sub-Clause 20.1 also states that unless and until the particulars supplied are sufficient to substantiate the whole of the claim, the Contractor shall only be entitled to payment for such part of the claim as he has been able to substantiate.

Sub-Clause 13.5 [Provisional Sum]

Sub-Clause 13.5 states that the Contractor shall, when required by the Engineer, produce quotations, invoices, vouchers and accounts or receipts in substantiation.

Moreover, as per Australian Law Dictionary, Substantiation means giving substance to a claim; providing proof of a claim or assertion, generally, or more specifically, in the course of a court action. On the other hand, in the legal practice, the particulars of a claim are a concise statement of the grounds and evidence on which the claimant’s case is founded. The Federal Court of Australia states that “the object of particulars is to limit the generality of pleadings by:

Informing an opposing party of the nature of the case the party has to meet;

Preventing an opposing party being taken by surprise at the trial; and

Enabling the opposing party to collect whatever evidence is necessary and available.”

As per Australia’s Uniform Civil Procedures Act 1999 (Qld) (UCPR), particulars may include certain documents, emails or information in relation to allegations.

From the above, it is understood that contemporary records, particulars and substantiation are interconnected. Their face depends on the circumstance. Sometimes, it is only fact, and sometimes, it is not limited to facts, it covers the horizon of calculation, methodology, relevant documents. However, the purpose of the particulars of a claim is to inform the defendant of the case and what they have to defend at its early stages. As such, the particulars of a claim will set out the facts that constitute the causes of action. The causes of action refer to the fact or facts that enable the claimant to bring an action against the defendant. The claimant must state all of the facts that are necessary to form the complete cause of action against the defendant. They must also give the defendant enough information for them to understand the case the claimant is bringing against them. In addition, the particulars of a claim must set out the remedies the claimant is seeking.